BayWa's stock experienced a downturn of up to 35% following the announcement of an external investigation into its financial restructuring possibilities. The Munich-based conglomerate, known for trading in agricultural supplies and produce, acknowledged the need for restructuring amid a "tense financing situation" due to escalating borrowing costs.
This development led to a significant drop in share value, positioning it at the lower end of the German small-caps index with a year-to-date decline of 52.78%. BayWa, facing a challenging financial landscape, reported long-term bank debts of 3.1 billion euros and short-term liabilities nearing 2.5 billion euros as of the end of March, according to its quarterly report.
The company, which previously announced intentions to divest its solar business, is navigating pressures within the European renewable energy sector, including solar module overcapacity and competition from low-cost Chinese manufacturers. A restructuring report, essential for creditor negotiations regarding loan extensions or additional financing, is anticipated.
Source: reuters.com